ORDER GRANTING DEFENDANT CEDARVILLE RANCHERIA OF NORTHERN PAIUTE INDIANS' MOTION TO DISMISS, GRANTING DEFENDANT CEDARVILLE RANCHERIA TRIBAL COURT AND DEFENDANT PATRICIA LENZI'S MOTION TO DISMISS, DENYING DEFENDANT CEDARVILLE RANCHERIA OF NORTHERN PAIUTE INDIANS' MOTION FOR SANCTIONS, AND DENYING PLAINTIFF RESOURCES FOR INDIAN STUDENT EDUCATION'S MOTION FOR A PRELIMINARY INJUNCTION

JOHN A. MENDEZ, District Judge.

This matter is before the Court on Defendant Cedarville Rancheria of Northern Paiute Indians' ("Defendant Tribe") Motion to Dismiss (Doc. #14) Plaintiff Resources for Indian Student Education, Inc.'s ("Plaintiff" or "RISE") Complaint (Doc. #1). Defendants Cedarville Rancheria Tribal Court and Judge Patricia Lenzi ("Tribal Court Defendants") bring a motion to dismiss (Doc. #17) on similar grounds. Also before the Court is Defendant Tribe's motion for Rule 11 sanctions (Doc. #15) and Plaintiff's motion for a preliminary injunction (Doc. #4). For the following reasons, both Defendant Tribe and Tribal Court Defendants' motions to dismiss are granted without prejudice, Defendant Tribe's motion for sanctions is denied, and Plaintiff's motion for a preliminary injunction is denied for lack of jurisdiction.1

I. FACTUAL ALLEGATIONS AND PROCEDURAL BACKGROUND

At some point prior to December 2013, Duanna Knighton resigned from her job with Defendant Tribe. Compl. ¶ 14. At the time that she was employed with Defendant Tribe, Knighton was also employed with Plaintiff RISE. Compl. ¶ 12. At the time of her resignation, Knighton and Defendant Tribe agreed that "she was owed the sum of $29,925, which represented accrued but unused 665 hours of sick leave." Compl. ¶ 14. Plaintiff alleges that "it was understood that the sum would be paid to RISE to maintain health insurance" for Knighton. Compl. ¶ 14. On December 18, 2013, Plaintiff received a letter from Defendant Tribe demanding reimbursement of the $29,925 paid to RISE on behalf of Knighton. Compl. ¶ 14.

On October 2, 2014, Defendant Tribe filed a complaint in Cedarville Rancheria Tribal Court ("Tribal Court") against RISE and Knighton. Compl. ¶ 11. The Tribal Court complaint ("Tribal Court Action") alleges multiple causes of action against Knighton, for "poor investments" that she made while employed with Defendant Tribe. Compl. ¶ 12. Defendant Tribe also filed an ex parte application for a temporary restraining order against RISE and Knighton in the Tribal Court Action. Compl. ¶ 16. Plaintiff alleges that this application was granted without providing RISE "with prior notice of the [a]pplication or a chance to be heard." Compl. ¶16. Plaintiff further alleges that "the Tribal Court unilaterally ruled that it has subject matter jurisdiction over the action[.]" Compl. ¶ 17. Plaintiff does not allege that it has affirmatively pursued a challenge to the Tribal Court's jurisdiction in the Tribal Court.

On October 30, 2014, Plaintiff filed a complaint (Doc. #1) in this Court for declarative and injunctive relief against Defendant Tribe and Tribal Court Defendants. Plaintiff also filed a motion for a temporary restraining order on November 19, 2014 (Doc. #4), which was denied for failure to provide notice to Defendants (Doc. #5). On November 26, 2014, Plaintiff re-filed the motion for a temporary restraining order (Doc. #8). The motion was again denied on the grounds that Plaintiff had failed to show the need for an expedited ruling (Doc. #9). Plaintiff's motion for a temporary restraining order was then converted into a motion for a preliminary injunction.

II. OPINION

A. Judicial Notice

Tribal Court Defendants request that the Court take judicial notice of several documents (Doc. #20). First, they request judicial notice of Plaintiff's complaint, Plaintiff's motion for a temporary restraining order/preliminary injunction, the Court's November 26, 2014 Order, and the parties' December 12, 2014 stipulation for an extension of time to file a responsive pleading. These documents are already part of the record in this case, and the request is denied as unnecessary.

Tribal Court Defendants also request that the Court take judicial notice of "the Declaration of Jack Duran, and all attached exhibits submitted in support of [Defendant Tribe's] motion for sanctions." Doc. #20 at 2. Exhibit 1, Exhibit 2, Exhibit 3, and Exhibit 7 to the Duran Declaration (Doc. #28) are filings from the Tribal Court Matter. As these court filings are matters of public record, they are appropriate for judicial notice. See, e.g., Sherman v. Stryker Corp., 2009 WL 2241664 at *2 (C.D. Cal. 2009) (citing Lee v. City of Los Angeles, 250 F.3d 668, 688 (9th Cir. 2001) and Fed. R. Evid. 201). However, the Court merely takes judicial notice of the existence of these filings, not of the facts included therein.

Exhibit A, Exhibit B, and Exhibit 4 of the Duran Declaration appear to be email communications between Defendant Tribe's counsel and Plaintiff's counsel. These email communications are not appropriate for judicial notice and the request is denied with respect to these three exhibits.

Exhibit 5 is an excerpt of the Federal Register noting that Cedarville Rancheria is an "Indian Tribal Entity . . . Eligible to Receive Benefits from the United States Bureau of Indian Affairs." This fact is a matter of public record and not subject to reasonable dispute, therefore the request for judicial notice is granted.

Exhibit 6 appears to be a slip opinion from a 2012 Ninth Circuit case, Grand Canyon Skywalk Development, LLC v. Sa Nyu Wa, Inc., This case is easily accessible on Westlaw and should have simply been referred to in the briefs with a legal citation. The request for judicial notice is denied.

Finally, Tribal Court Defendants request that the Court take judicial notice of the Cedarville Rancheria Judicial Code, which is attached to Plaintiff's complaint. Documents that are "attached to the complaint and incorporated within its allegations" are part of the pleadings, and are properly before the Court on a motion to dismiss. Shade v. Wells Fargo Bank, 2009 WL 1704715, at *1 (E.D. Cal. June 17, 2009). The Court need not take judicial notice of a document attached to Plaintiff's complaint, therefore this request is denied as unnecessary.

B. Discussion

1. Motions to Dismiss

Defendant Tribe and Tribal Court Defendants both argue that Plaintiff's complaint must be dismissed in its entirety because Plaintiff failed to exhaust its remedies by challenging jurisdiction in the Tribal Court. Tribe MTD at 5; Tribal Court MTD at 6. Plaintiff appears to concede that it has not exhausted its remedies in the Tribal Court, but argues that the exhaustion requirement does not apply because (a) "the assertion of tribal court jurisdiction is `motivated by a desire to harass or is conducted in bad faith;' (b) the tribal court action is `patently violative of express jurisdictional prohibitions;' (c) `exhaustion would be futile because of the lack of an adequate opportunity to challenge the tribal court's jurisdiction;' and (d) it is `plain' that jurisdiction is lacking, so that the exhaustion requirement `would serve no purpose other than delay.'" Opp. to Tribe MTD at 9; Opp. to Tribal Court MTD at 10 (both citing Elliott v. White Mountain Apache Tribal Court, 566 F.3d 842 (9th Cir. 2009)).

The Ninth Circuit has noted that "[f]ederal law has long recognized a respect for comity and deference to the tribal court as the appropriate court of first impression to determine its jurisdiction." Grand Canyon Skywalk Dev., LLC v. `Sa' Nyu Wa Inc., 715 F.3d 1196, 1200 (9th Cir. 2013). The Supreme Court has cited three reasons for this approach: (1) Congress's commitment to "a policy of supporting tribal self-government and self-determination;" (2) the prudence of allowing "the forum whose jurisdiction is being challenged the first opportunity to evaluate the factual and legal bases for the challenge;" and (3) the interest of judicial economy, which is served "by allowing a full record to be developed in the Tribal Court." Nat'l Farmers Union Ins. Companies v. Crow Tribe of Indians, 471 U.S. 845, 856 (1985).

Accordingly, "non-Indian defendants must exhaust tribal court remedies before seeking relief in federal court[.]" Burlington N. R. Co. v. Crow Tribal Council, 940 F.2d 1239, 1244 (9th Cir. 1991) (emphasis in original). The Ninth Circuit has noted that the exhaustion requirement applies "even where defendants allege that proceedings in tribal court exceed tribal sovereign jurisdiction." Id. at 1244. Therefore, "federal courts should not even make a ruling on tribal court jurisdiction. . . until tribal remedies are exhausted." Grand Canyon Skywalk, 715 F.3d at 1200. However, a party need not show that it has exhausted its tribal court remedies where:

If none of these exceptions apply, federal jurisdiction will not lie until all tribal remedies have been exhausted.

As noted above, Plaintiff concedes that it has not exhausted its tribal remedies. Opp. to Tribe MTD at 7; Opp. to Tribal Court MTD at 9. Specifically, it does not argue that it has already challenged the Tribal Court's jurisdiction in the Tribal Court. Rather, Plaintiff argues that that it would be forced "to expend substantial money and resources to establish the lack of the Tribal Court's jurisdiction by exhausting Tribal Court remedies where [each of the four above-quoted exceptions applies.]" Opp. to Tribe MTD at 8-9; Opp. to Tribal Court MTD at 10. However, Plaintiff goes no further than naming each of the four exceptions to the traditional requirement of tribal court exhaustion. Plaintiff does not address why any of these exceptions should apply to this case. Nor does Plaintiff point to any specific factual allegations which would support the application of a specific exception to this case. Indeed, in Plaintiff's Complaint, there are no additional specific factual allegations to support the application of each exception to the exhaustion requirement. See Compl. ¶ 9 (citing Elliot for the four exceptions to the exhaustion requirement, but not providing additional, specific supporting allegations). Without any supporting allegations, and without any further argument to connect the facts of this case to one of the four exceptions listed above, the Court finds that none of these exceptions apply. In light of Plaintiff's failure to exhaust its tribal court remedies, this Court may "not even make a ruling on tribal court jurisdiction." Grand Canyon Skywalk, 715 F.3d at 1200.

Plaintiff's attempt to distinguish Burlington is unpersuasive. Opp. to Tribe MTD at 8; Opp. to Tribal Court MTD at 9. Although the factual and procedural background of Burlington differs somewhat from that of this case, the Ninth Circuit's general description of the exhaustion requirement — and the four exceptions to that requirement — is nevertheless binding on this Court. Burlington, 940 F.2d at 1244 at 1065. Moreover, the Burlington court precisely addressed the issue presented here, noting that the exhaustion requirement applies "even where defendants allege that proceedings in tribal court exceed tribal sovereign jurisdiction." Id. at 1244. Regardless of the factual differences between Burlington and the present case, Burlington accurately lays out the applicable legal framework.

Plaintiff cites a number of cases which discuss the limited circumstances in which a federal court need not recognize the judgment of a tribal court. Opp to Tribe MTD at 9; Opp to Tribal Court MTD at 10-11 (both citing Wilson v. Marchington, 127 F.3d 805 (9th Cir. 1997) and AT & T Corp. v. Coeur d'Alene Tribe, 295 F.3d 899 (9th Cir. 2002)). However, the issue presently before the Court is not whether the judgment of the Tribal Court should be recognized and enforced; rather, the Court must initially consider whether Plaintiff's failure to exhaust its tribal remedies is fatal to its invocation of federal jurisdiction. The cases cited by Plaintiff, which discuss "comity" and "recognition" of tribal court judgments, are not instructive on this point.

As Plaintiff has failed to exhaust its tribal court remedies — and as Plaintiff has failed to establish that one of the four exceptions to the exhaustion requirement applies — this Court may not consider the merits of Plaintiff's claim. Burlington, 940 F.2d at 1244; Grand Canyon Skywalk, 715 F.3d at 1200. The Court need not — and should not — address Defendant Tribe and Tribal Court Defendants' arguments with respect to sovereign immunity, ripeness, and failure to state a claim, in light of Plaintiff's failure to exhaust its tribal court remedies. See Burlington, 940 F.2d at 1242-43 (declining to consider "jurisdictional issues of constitutional dimension" before considering the exhaustion issue). Because Plaintiff can cure the jurisdictional defect by exhausting its tribal court remedies, Defendant Tribe and Tribal Court Defendants' motions to dismiss are granted without prejudice.

2. Motion for Sanctions

Defendant Tribe urges the Court to "impose Rule 11 sanctions on Plaintiff's counsel for premature filing of the Complaint in this matter." Mot. for Sanctions at 1. Defendant Tribe further argues that "the Complaint is not legally tenable or well-grounded in fact." Mot. for Sanctions at 1. Plaintiff responds that sanctions are not appropriate because "there is a genuine and legitimate dispute as to the jurisdiction asserted by" the Tribal Court. Opp. to Mot. for Sanctions at 5.

Rule 11 of the Federal Rules of Civil Procedure provides for the imposition of sanctions when a filing is frivolous, legally unreasonable, lacks factual foundation, or is brought for an improper purpose. Fed. R. Civ. P. 11(b)(1)-(4). The Ninth Circuit has established "that sanctions must be imposed on the signer of a paper if either a) the paper is filed for an improper purpose, or b) the paper is `frivolous.'" Townsend v. Holman Consulting Corp., 929 F.2d 1358, 1362 (9th Cir. 1990).

Rule 11 sanctions are not appropriate in this case. Although Plaintiff has failed to convince this Court that Plaintiff's failure to exhaust its tribal court remedies should be excused, the Court does not find that Plaintiff's complaint was frivolous or brought for an improper purpose. Plaintiff correctly cited four well-established exceptions to the exhaustion requirement, but failed to successfully argue that the facts of this case merit the application of one of those exceptions. Not all unsuccessful arguments are sanctionable. Defendant Tribe's motion for sanctions is denied.

3. Motion for Preliminary Injunction

As the Court has granted Defendant Tribe and Tribal Court Defendants' motions to dismiss for failure to exhaust tribal remedies, the Court does not have jurisdiction to consider Plaintiff's motion for a preliminary injunction. Relatedly, the Court need not consider Defendants' joint objection to Plaintiff's motion, on the grounds that service was improper (Doc. #22). Plaintiff's motion for a preliminary injunction is denied for lack of jurisdiction.

III. ORDER

For the reasons set forth above, the Court GRANTS WITHOUT PREJUDICE Defendant Tribe's motion to dismiss, GRANTS WITHOUT PREJUDICE Tribal Court Defendants' motion to dismiss, DENIES Defendant Tribe's motion for sanctions, and DENIES Plaintiff's motion for a preliminary injunction. Plaintiff may file a First Amended Complaint once it has exhausted its tribal court remedies.

IT IS SO ORDERED.